Today, President Barack Obama referred to the Washington Post Hit Story on Governor Mitt Romney in several tweets. The problem is that the story is full of half truths and out right lies.
In what is meant to be a bombshell political story, the Washington Post is attempting to paint Republican presidential nominee Mitt Romney as a private equity boss who got rich by shipping American jobs overseas.
Or maybe this was a story just too politically juicy to properly check.
But whatever the reason, WaPo World’s version of Romney’s business career at Bain Capital may not correspond with reality, via a source familiar with Bain’s activities as well as a detailed analysis of the piece.
Bain’s foray into outsourcing began in 1993 when the private equity firm took a stake in Corporate Software Inc., or CSI, after helping to finance a $93 million buyout of the firm. CSI, which catered to technology companies like Microsoft, provided a range of services including outsourcing of customer support. Initially, CSI employed U.S. workers to provide these services but by the mid-1990s was setting up call centers outside the
Romney Reality: What CSI actually did was provide U.S. software developers with technical support and sales. Example: It provided domestic outsourcing — which is different than overseas offshoring — for call centers and help desks. As far as its international business goes, CSI was reseller of U.S. software in European markets. In other words, they helped distribute U.S. software around the world.
Two years after Bain invested in the firm, CSI merged with another enterprise to form a new company called Stream International Inc. Stream immediately became active in the growing field of overseas calls centers. … By 1997, Stream was running three tech-support call centers in Europe and was part of a call center joint venture in Japan, an SEC filing shows. … Stream continued to expand its overseas call centers. And Bain’s role also grew with time. It ultimately became the majority shareholder in Stream in 1999 several months after Romney left Bain to run the Salt Lake City Olympics. … Bain sold its stake in Stream in 2001, after the company further expanded its call center operations across Europe and Asia.
Romney Reality: Those overseas call centers in the WaPo story were based in Europe and Japan, and serviced international customers of U.S. companies in their local languages.
3. WaPo World:
The corporate merger that created Stream also gave birth to another, related business known as Modus Media Inc., which specialized in helping companies outsource their manufacturing. Modus Media was a subsidiary of Stream that became an independent company in early 1998. Bain was the largest shareholder, SEC filings show. … In December 1997, it announced it had contracted with Microsoft to produce software and training products at a center in Australia. Modus Media said it was already serving Microsoft from Asian locations in Singapore, South Korea, Japan and Taiwan and in Europe and the United States. …
Two years later, Modus Media told the SEC it was performing outsource packaging and hardware assembly for IBM, Sun Microsystems, Hewlett-Packard Co. and Dell Computer Corp. The filing disclosed that Modus had operations on four continents, including Asian facilities in Singapore, Taiwan, China and South Korea, and European facilities in Ireland and France, and a center in Australia. …
Romney Reality: Again, what Modus Media did was help companies like Microsoft and IBM sell their products internationally. Products destined for American consumers were manufactured here at home.